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PerkinElmer to Acquire Caliper for $600M

NEW YORK (GenomeWeb News) – PerkinElmer has signed a definitive agreement to acquire Caliper Life Sciences for $10.50 per share, or $600 million, the firms announced today.

The deal will broaden PerkinElmer's reach in the life sciences research space, providing the firm with Caliper's portfolio of imaging, microfluidics, automation, and sample preparation platforms and technologies. It also will combine Caliper's imaging instrumentation for in vivo imaging applications with PerkinElmer's broad offering of imaging reagents, which the firm gained through its VisEn Medical acquisition last year.

Caliper also has placed an emphasis over the past couple of years of pushing its technologies into the high-growth next-generation sequencing and molecular diagnostics markets, which are both markets that PerkinElmer has recently targeted as well.

In the next-gen sequencing space, PerkinElmer launched its next-generation DNA sequencing and data analysis services early in 2011. And in May it acquired Geospiza, a bioinformatics firm that makes software packages for next-gen sequencing and microarray analysis, including cloud-based products.

Meanwhile, Caliper launched the LabChip XT automated nucleic acid fractionation instrument for sequencing applications and the Sciclone NGS Workstation for automating high-throughput sequencing sample preparation.

PerkinElmer Chairman and CEO Robert Friel said on a conference call this morning, "While we're not necessarily interested in competing in the sequencers themselves, the sort of workflow around it and the informatics at the back end are areas that we're very interested in. … We've had some sample prep and automation and liquid handling capability on the front end, and Caliper brings much stronger capability from that perspective."

The molecular imaging and next-gen sequencing capabilities of the combined firm are two components of the diagnostics strategy, adding to PerkinElmer's expansive prenatal screening business. Caliper also offers the LabChip Dx instrument, which it launched earlier this year for clinical labs developing molecular diagnostic tests.

Caliper CEO Kevin Hrusovsky, who plans to join PerkinElmer's senior leadership team following closure of the acquisition, said on the call that the firm sold 40 of those new instruments in the first half of the year and expects to sell at least another 25 in the third quarter.

PerkinElmer "already has an infrastructure for diagnostics," said Hrusovsky. "We think that there's going to be opportunities to maybe accelerate the timelines primarily on the 510(k) opportunities."

Earlier this year Hrusovsky mapped out Caliper's companion and molecular diagnostics plans in an interview with GenomeWeb Daily News. He cited the firm's alliance with Seegene for the development of molecular diagnostic assays and its tissue imaging capabilities as components of that strategy.

The purchase price represents a 42 percent premium to Caliper closing price of $7.39 Wednesday on the Nasdaq.

The deal is expected to close in the fourth quarter of 2011 and is expected to be dilutive to PerkinElmer's 2012 GAAP earnings per share by roughly $.05 but accretive to the 2012 First Call adjusted EPS by approximately $.08. Friel said on the call that about a third of the purchase price will be provided by cash on hand and about two-thirds will come from bank or public debt.

Friel added that he doesn't anticipate any issues with the deal clearing US Federal Trade Commission review and doesn't believe any divestitures will be necessary.

For PerkinElmer the acquisition of Caliper is the latest and largest of a string of deals it has completed this year. Many of its acquisitions this year, including Geospiza, CambridgeSoft, and ArtusLabs, have expanded its capabilities in the bioinformatics area.